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Configure tax collection

Set up a tax rate yourself, or let Stripe Tax work it out from your business address.

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Payment for Stripe applies the rate to your charges and records the detail in Stripe for your returns.
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Last updated November 2026

Quick answer

Create a tax rate in the app and apply it to your charges, or turn on Stripe Tax to have the rate worked out from your business address. One rate applies at a time, across the whole sale.

Official documentation: Stripe Tax

From the blog

How to get started

Follow these 4 simple steps to get up and running.

  1. 1

    Choose automatic or manual tax

    Open Settings and scroll to "Taxes, Gratuity & Fees". Turn on "Collect tax automatically" and Stripe Tax works out the rate from your business address. Leave it off and you pick the rate yourself. It's one or the other: Stripe won't accept both on the same charge.

  2. 2

    Create your tax rates

    Open Stripe Account from the menu, tap Tax Rates, then the + button. Enter a name (like "Sales Tax" or "VAT"), the percentage, and whether it's inclusive or exclusive. Add as many as you need for the jurisdictions you sell in.

  3. 3

    Apply a rate to your charges

    In Stripe Account > Tax Rates, swipe a rate and tap "Add to Cart", or open the rate and tap the same button. It stays on every charge until you remove it, so check which rate is active before you switch between jobs. One rate applies at a time.

  4. 4

    Review tax reports

    Track what you've collected in your Stripe Dashboard. Manual rates export from the Tax Rates page; Stripe Tax has its own reports under Tax. Either way, Payment for Stripe records the rate on every charge, so your totals are ready when you file.

FAQ

Common questions

What's included in Stripe Tax?
Stripe Tax Basic tracks where you owe tax, calculates the rate for 600+ product types, and collects it in 100+ countries. It only calculates where you're registered, and it doesn't file returns: Stripe Tax Complete (from $90/month) adds registrations and filings. US pay-as-you-go pricing is 0.5% per transaction for no-code tools like Payment Links, or 50¢ per transaction through Stripe's API, which is how Payment for Stripe calculates tax on in-person sales.
What's the difference between inclusive and exclusive tax?
Exclusive tax is added on top of the price (e.g., $100 + 10% tax = $110 total). Inclusive tax is already included in the price (e.g., $100 total with 10% tax means $90.91 + $9.09 tax). Most US businesses use exclusive pricing, while many European businesses use inclusive pricing with VAT.
Can I set up VAT for European customers?
Yes. Create a tax rate with your VAT percentage and mark it inclusive if your prices already include VAT. One thing to watch: an inclusive rate only works on prices you've also marked inclusive in Stripe. Mix an inclusive rate with an exclusive price and Stripe won't apply it, and the line shows as "Not taxed" on the review screen. Match the two and it works.
Can I charge different tax rates on different items in the same sale?
Not right now. One rate applies to the whole cart. If you sell items taxed at different rates (a zero-rated book and a taxable service, say), ring them up as separate charges so each gets the rate it should. Per-line-item tax rates are on our list.
How do I handle tax-exempt customers?
Remove the rate before you take the payment. Open Stripe Account > Tax Rates, swipe the active rate, and tap "Remove from Cart". The charge goes through with no tax added. Put it back before your next customer. The setting sticks until you change it.
Does Payment for Stripe calculate tax automatically based on location?
Yes, if you turn on "Collect tax automatically" in Settings. That's Stripe Tax, and it works out the rate from your business address. It replaces manual rates rather than stacking with them. With it off, the app uses whichever rate you've applied and won't vary it by customer location.

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